Analyst: DoD $300B Short If Strategy Unchanged

WASHINGTON — The Department of Defense will be hundreds of billions of dollars short of what's needed to enact the nation's official defense strategy in coming years, a new report on the nation's defense budget released Thursday predicts.

To execute programs and plans laid out in budget and strategy documents, DOD will need $200 billion to $300 billion more than allowed by automatic spending limits known as sequestration, according to the report by Todd Harrison, senior fellow at the Center for Strategic and Budgetary Assessments, a nonpartisan Washington think tank.

And the analysis doesn't take into account the demands of new and intensified conflicts in places such as Ukraine or Iraq, where the United States has been pulled back into airborne combat missions. Since June, the U.S. has spent some $600 million on limited airstrikes and an advisory mission aimed at halting the advance of Islamist insurgents.

And earlier this week in Estonia — a nation nervous that its neighbor Russia is intent on dragging it back into a revived Soviet sphere — President Barack Obama hammered home the point that the United States would stand firmly behind all its NATO allies.

The United States now must decide whether to provide more defense funding or trim military missions — and potentially tell some partners overseas they're on their own, Harrison said.

"We're kind of at a fork in the road in the strategy-budget process," he told reporters Thursday in Washington.

Sequestration calls for about $1 trillion less in defense spending over decade than defense planners had expected before 2011, when the cuts became law. As a result, the U.S. military now forecasts declining end strengths, reduced unit readiness and curtailed modernization of weapons systems.

The 2012 defense strategic guidance called for a shift of military emphasis and resources from the Middle East to Asia, where a resurgent China has been building its military and flexing its muscles in territorial disputes with Japan, Vietnam and others.

The strategy was upheld this year by the Quadrennial Defense Report, which has been assailed by Republicans in Congress who say the document is geared more toward presenting an affordable strategic assessment in a time of falling defense spending than a realistic one.

But even the current strategy is too expensive if Congress and the president leave sequestration the law of the land, Harrison concluded in his 34-page report.

"The Department appears to be caught between two approaches for addressing its strategy-resource mismatch," Harrison wrote. "It has not budgeted enough to fully resource the defense program called for by its strategy, nor has it revised its strategy and defense program to fit within the budget constraints set by Congress."

Harrison tallied up expected defense shortfalls to reach his estimate of $200 billion to $300 billion.

Current budget limits won't fund enough troops or warships to enact the defense strategy, he said. The Army plans to cut its active-duty end strength to 450,000 by 2019 while the Marines plan to level off at 182,000, but critics say the current budget limits won't even support those reduced levels.

"Assuming these force levels are needed to execute the strategy at an ‘acceptable' level of risk, the budget appears to be roughly $20 billion short" over the coming five years, the report said.

DOD also appears to be counting on $50 billion to $100 billion in overseas wartime funding to cover core expenses in coming years, he said. Another $31 billion in savings from controversial proposed cuts to military compensation and weapons programs are needed — cuts Harrison characterized as "unlikely to materialize."

DOD's most recent budget request assumes the Pentagon will be allowed to exceed sequestration caps by $116 billion over five years. It's not a safe bet that a bitterly divided Congress will be able to reach an agreement to kill sequestration even for pressing strategic reasons, he said.

"They tweaked it, but they haven't been able to turn it off," he said.

In response to a question about the CSBA report, a Pentagon spokesman said Thursday the department was striving to find a way to avoid sequestration, which former Defense Secretary Leon Panetta referred to as a "meat ax."

"We are acutely aware that sequestration remains the law of the land, and we are working all the time with Congress to forge a way ahead here," Col. Steve Warren told reporters.

If the situation persists, the United States may be forced to adjust its defense strategy, Harrison said.

"That may mean coming up with more innovative concepts for how we will conduct missions and achieve our strategic objectives around the world," he said. "It also may mean shedding priorities and divesting ourselves of some security commitments in the future.

"That's going to be painful and uncomfortable, and people aren't going to like it," he said. "But that is one way … to reduce what we're expecting the Department of Defense to do in the future."